Public Bill Committee

[Mrs. Joan Humble in the Chair]

Further written evidence to be reported to the House

TRI 15 Jeremy Sutcliffe

Clauses 59 to 70 ordered to stand part of the Bill.

Clause 71

Rent

Henry Bellingham: I beg to move amendment No. 131, in clause 71,page 48, line 4, leave out ‘and’.

Joan Humble: With this it will be convenient to discuss the following amendments: No. 132, in clause 71, page 48, line 5, at end insert
‘, and
(c) any service charges defined under the lease.’.
No. 133, in clause 71, page 48, line 6, leave out ‘services,’.
No. 134, in clause 71, page 48, line 11, leave out ‘and use’ and insert ‘, use and service charge’.

Henry Bellingham: Again, it is a pleasure to be serving under your chairmanship, Mrs. Humble.
These are probing amendments and they are very simple, so I shall not detain the Committee. I wish to ask the Minister to clarify some points. Amendment No. 132 is probably the critical one in the group. Clause 71(1)(b) refers to
“any value added tax chargeable on that amount or interest”,
under which amendment No. 132 would add proposed paragraph (c), referring to
“any service charge defined under the lease.’.
The rent payable under the lease would then include any interest payable, plus value added tax, plus service charges. In some circumstances, it is fair for a landlord to be able to charge for arrears of service charge in addition to other items. Sometimes, the service charge may be dealt with on a totally different basis, but ifit is outstanding because there has been a deliberate attempt not to pay and it has been disregarded completely by the tenant, the rent should include any service charge defined under the lease.
Amendment No. 131 is a paving amendment as it would leave out “and”, while amendment No. 132 is the key amendment and Nos. 133 and 134 are basically consequential and probing amendments. I should like to hear what the Minister has to say about them because they are important issues that have beenraised with us by a number of organisations seeking clarification.

Simon Hughes: Good morning, Mrs. Humble. The Committee will note that I supported the investigation of such issues. At the moment, this part of the Bill deals with commercial rent arrears, not domestic premises, as we discussed on Tuesday. For many people, rent is a substantial issue, but service charges will be linked in many cases. It therefore seems that we should provide a procedure that looks at the ability of rent and service charges to be included. At present, clause 71(2) expressly says that rent
“does not include any sum in respect of rates, council tax, services, repairs, maintenance, insurance or other ancillary matters (whether or not called ‘rent’ in the lease).”
It is obviously right that rates and council tax should not be included. They are a liability to someone else. Insurance does not follow necessarily. People have to take out insurance, but tenants have some discretion over that. Repairs and maintenance obligations are not fixed in the same way as service charges are usually fixed; they are normally a fixed amount. The charge comes with the building and is part of the initial obligation. I should be interested to hear whether the Minister and her colleagues have considered including service charges and, if they have, why they still want to exclude them. If they have not considered such a proposal, are they willing to do so?

Vera Baird: Good morning, Mrs. Humble. In this part of the Bill, rent is defined as the amount payable under the lease for possession and use of the premises, including any interest payable or VAT chargeable. We are content with that definition. It follows the Law Commission’s recommendation in its report on distress for rent in 1991, which relied on a ruling in T and E Homes Ltd. v. Robinson in 1979. We think that rent should be sums that are attributable directly to the tenant’s enjoyment of the land. Items such as service charges, repair costs, insurance premiums and so forth, which are directly attributable to something else—not enjoyment of the land—do not fall within the definition of rent and should be excluded.
There are, of course, other ways in which to recover such money, but it is not appropriate that distraining for rent, albeit that it is now abolished for domestic premises by the Government and applicable only to commercial premises, should have application to anything beyond rent. The issue of certainty is important because it is a non-court remedy and rent is certain, while service charges will not be. That is our reasoning, and I hope that it has reassured the Opposition.

Henry Bellingham: In her usual courteous way,the hon. and learned Lady has reassured me and the Committee, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 71 ordered to stand part of the Bill.

Clause 72

The rent recoverable

Henry Bellingham: I beg to move amendment No. 135, in clause 72, page 48, line 27, at end insert
‘, and must be set at a reasonable amount so that a landlord does not suffer hardship.’.
Clause 72 refers at some length to CRAR. The Committee will be aware of the background to the clause, which sets out how the rent is recoverable. Subsection (2) states that the
“amount of any rent recoverable by CRAR is reduced by any permitted deduction”,
while subsection (4) refers to the minimum amount of the rent and states:
“The minimum amount is to be calculated in accordance with regulations.”
That is clear to some extent, but the amendment would insert at the end:
“and must be set at a reasonable amount so that a landlord does not suffer hardship.”
It is a probing amendment suggested by a number of organisations that are interested in that part of the Bill. It might be slightly clumsily drafted and mightnot be ideal. However, in setting the minimum amount and calculating it, in accordance with regulations,there is some concern that in a small minority of circumstances, the interests of the landlord might not be considered. Obviously, one has to look at what the regulations say; some of them will presumably be laid at some future stage and it has been indicated that they will lay down certain parameters. In debating the Bill, we have talked about the interests of either the debtor or the tenant, but our small amendment is a probing one to ensure that the interests of the landlord are properly considered at all times, particularly when the minimum amount is being calculated.

Vera Baird: We are indeed in the land of CRAR and I should probably, therefore, say what it is: commercial rent arrears recovery. I am sure that we will talk about it a lot, and people might not have followed where we are.
 CRAR is available only where the amount recoverable is in excess of a minimum amount, which, as the hon. Gentleman said, will be set up in accordance with regulations. That unpaid amount may not include accrued interest, VAT or other permitted deductions.
We will take care to ensure that the conflicting needs of landlord and tenant are managed by setting the minimum at an appropriate level. Our initial thinking suggests a trigger sum of something like one week’s rent or £200—whichever is the smaller—or four weeks’ arrears if the rent is less than £50. Currently those are, in our minds, perhaps appropriate minimums to apply for CRAR purposes. We are open to suggestions, but it seems to me that we are starting at a reasonable point. If we set the level at around that margin, we will not be allowing too onerous a penalty for too small a debt on the tenant and will not be cheating the landlord unless he has serious financial problems himself. I hope that the hon. Gentleman is reassured.

Henry Bellingham: I am grateful to the Minister for the clarification and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 72 ordered to stand part of the Bill.

Clauses 73 and 74 ordered to stand part of the Bill.

Clause 75

Agricultural holdings

Question proposed, That the clause stand part of the Bill.

Henry Bellingham: I should like to put a couple of points to the Minister on clause 75. I had an e-mail from the National Farmers Union in which Barney Holbeche, its chief parliamentary adviser, wrote:
“We are surprised that an agricultural holdings provisionhas crept in to a Bill of this kind. Detailed issues concerning agricultural holdings law have been under review by a Defra-approved cross-industry working group called TRIG (Tenancy Reform Industry Group). TRIG produced proposals recently for modest changes to the law which the Government implemented by way of a Regulatory Reform Order. The curious thing is that so far as we know the application of CRAR in relation to agricultural holdings has not been referred to TRIG for farming industry discussion as it should have been.”
Surely the Minister should have had proper consultations with the Department for Environment, Food and Rural Affairs about the clause? The NFU is slightly concerned, but points out that
“it is unlikely that rent recovery procedures would be much used in agriculture. This is because a tenant who cannot pay his rent on time would usually reach an amicable agreement with his landlord, knowing that if he failed to pay the rent on time he would be in breach of his tenancy.”
Anyone who knows anything about the farming industry knows that if someone is in breach of their tenancy, they are in danger of losing their home and business. Therefore, it is unlikely that the procedure would apply to an agricultural tenancy, but it is possible. There is also concern about lack of consultation. Will the Minister write to me in due course to explain the situation?

Simon Hughes: My understanding is that all thelaws on agricultural holdings appear in legislation that deals with agriculture holdings themselves. There is obviously a tradition of dealing with agricultural property relationships separately, and there has been much legislation on the subject. Therefore, in addition to the point made by the hon. Member for North-West Norfolk, I am concerned that the recovery process has crept into the Bill, particularly because it starts offby stating that the process will not apply in most circumstances. Will the Minister consider taking it out of the Bill and putting it in appropriate legislation? That is one of my bugbears. Legislation should be as streamlined as possible. If someone wants to look into the law about agricultural property, tenancy and holdings, they should be able to look at one set of Acts called agricultural holdings legislation and not have to look anywhere else.

Vera Baird: The Bill was published in July 2006 and has been through the usual Government clearance process. It is very well known to the Department for Environment, Food and Rural Affairs that CRAR is in the legislation. It is not exercisable to recover rentmore than a year overdue at the time notice of recovery is given. Permitted deductions can include any compensation due to the tenant in respect of the relevant holding. After hearing the hon. Member for North-West Norfolk, I do not think that the recovery process is likely to be used very much, but it is regarded as a useful remedy that ought to be in the Bill. I invite the hon. Gentleman to withdraw his concerns and to allow the legislation to go through.

Simon Hughes: I shall reflect on that and take advice. I am still not persuaded that the Bill is the right place for that legislation.

Henry Bellingham: I will do likewise. I will not withdraw my concerns as such but keep them registered. I will have further discussions and come back to the Minister in due course, but I am grateful to her for that initial explanation.

Question put and agreed to.

Clause 75 ordered to stand part of the Bill.

Clauses 76 to 81 ordered to stand part of the Bill.

Schedule 14 agreed to.

Clauses 82 and 83 ordered to stand part of the Bill.

Clause 84

Application to the Crown

Question proposed, That the clause stand part of the Bill.

Simon Hughes: This is obviously a simple clause that says:
“This Part binds the Crown... But the procedure in Schedule 12 may not be used...to recover debts due from the Crown...to take control of or sell goods of the Crown (including goods owned by the crown jointly or in common with another person), or...to enter premises occupied by the Crown.”
Will the Minister explain how wide is the definition of the Crown? The Palace of Westminster, for example, used to be protected from all sorts of legal interventions because of its special status. In some circumstances, the definition of the Crown could be extended to include agencies of the Crown. I can understand that it would be rather indelicate for the bailiffs to go into Buckingham palace; it would not look terribly good if somebody had not paid the electricity bill. However, there should be a procedure, which would need to be extremely tightly drawn, for people to get their money back.

Vera Baird: I do not think that the measure is intended to deal with Buckingham palace. It refers to the Crown in the form of the Government. The Palace of Westminster can never conceivably have been part of the Crown. In fact, I see that the Crown does include the Palace of Westminster. That is extraordinary. It also includes agents of the Crown.

Simon Hughes: My suspicions and fears are realised. We need to reflect on this point. The measure appears to be narrowly drawn. There are lots of Crown agencies; I do not know whether it applies, for example, to the Duchy of Cornwall, which owns estates over the road, including the Oval cricket ground, or to Crown property around Regent’s park, or to lots of other Crown lands. There will be cases of bills not having been paid that have no remedy. If the debtor is a Crown agency, how do people go about getting their money?

Vera Baird: The provision does not mean that such cases have no remedy; it means that they do not have this remedy. They have every other remedy under common law of which I am aware. However, I shall not give the hon. Gentleman a comprehensive list at present.

Question put and agreed to.

Clause 84 ordered to stand part of the Bill.

Clause 85 ordered to stand part of the Bill.

New Clause 2

Uniforms
‘All enforcement agents, both private and Crown employed, must at all times wear a uniform as prescribed by the Secretary of State.’.—[Mr. Ellwood.]

Brought up, and read the First time.

Tobias Ellwood: I beg to move, That the clause be read a Second time.
It is a pleasure to work under your tutelage today, Mrs. Humble. It has been interesting to be part of a major overhaul of the entire enforcement system, particularly with respect to bailiffs. It is well overdue, and we ask the Minister to consider going a step further.
The new clause would be a useful, radical and simple provision. The entire process is complex and confusing in law. The new clause is straightforward: it would require bailiffs to be given a uniform. That would not replace the ID that they are expected to carry, but work in addition to it. In researching the subject, I was interested to come across a BBC documentary on bailiffs. It included some undercover work, which showed the attitudes of people whose goods were taken away and of the bailiffs, who worked for private companies, many of whom were labelled as hired thugs. That does not do the industry any good whatsoever.
The new clause would put a more acceptable face on the work of the bailiffs. We see uniforms used in many walks of life, not only in the military, but in other security companies and in the NHS. A uniform shows a degree of authority; it shows status and helps to generate respect. That is exactly what is required of bailiffs, particularly those who work for councils, private bailiffs and so on. That is why we wish to introduce the new clause.
In rare circumstances, bailiffs operate in conditions in which they are not sure what to expect. There might be a requirement to wear additional protection, which could be part of the consideration of the uniform.
The new clause says that the Crown employee
‘must at all times wear a uniform as prescribed by the Secretary of State.’.
It would be fair to say, Mrs. Humble—this is no reflection whatsoever on your chairmanship—that the Bill has not been the sexiest one that has gone through the House. [Interruption.] It is not a Bill that immediately grabs the limelight. However, judging by the level of noise that that comment has generated, I am pleased to see that perhaps my thoughts on the Bill should be put into question. The way that the new clause is written provides an opportunity for the Minister to throw a little public limelight on to the Bill and on to the workings and proceedings of the Committee. The Minister might consider coming up with the first design of that uniform.

Vera Baird: Bottle green.

Tobias Ellwood: Indeed. From what I hear in the tea rooms, the Minister is considered to be quite a trendy dresser; in fact, that is reflected in what she is wearing today.
This is a fantastic opportunity for us to showthe workings and proceedings of our Committee, regarding something that is perhaps considered light-hearted but is actually very serious. The new clause would be a simple but important addition to the legislation, and I certainly hope that the Government will view it sympathetically. We have developed it in consultation with those in the industry, who are also keen to see such a measure. I am also pleased to see that the Liberal Democrats are supporting it, and I certainly hope that the Minister will consider doing so.

Simon Hughes: We are indeed very supportive of the new clause, and the Minister indicated the other day that she was sympathetic to it, so we are hopeful that we will make some progress.
When we added our names to the new clause, Ihad not anticipated that the hon. Member for Bournemouth, East, with his military background, would see uniforms as the way of sexing up the Bill, but there we are. I understand now that that idea is compatible with his past and links his past with his present, and it may be an additional argument in favour of the new clause.
There is a strong case for this proposal. People often do not know who is at their door; people often claim to be people whom they are not, and people regularly allege that they have a right to enter a property. We often read in local papers all over the country that people pretend to have authority on behalf of a utility company, a bank or finance company. One way of minimising that risk is to ensure that people are in uniform. I remember that we had such a debate in another Committee, when we were considering legislation in relation to people who have a right to come into people’s homes.
I hope that the Minister is sympathetic to thenew clause. We do not pretend that the drafting is perfect, but it seems to be a perfectly good, sensible proposition, which is absolutely in accord with the public mood about how bailiffs and those in the enforcement agencies should conduct their business.I therefore hope that the Minister will give us a sympathetic response.

Emily Thornberry: I am someone on the Committee who has perhaps had a fairly unique experience in this area. When I was seven years old, my mother and my family were thrown out of our house by bailiffs. The bailiffs were all wearing bowler hats; that was their uniform then. It was a profoundly embarrassing experience. I remember that, even though I was only seven, I was profoundly embarrassed by it. We must counter all the discussion about uniforms with this consideration: if a group of uniformed bailiffs were to appear on an estate, it would make the process that much more difficult and oppressive for the family who were suffering it and much more terrifying for the children.

Vera Baird: That is a terrible tale, and I can imagine that it is etched on my hon. Friend’s memory, not least because of the bowler hats, although I would have thought that it was generally a pretty awful experience. However, it is probably better to return to the level that we were at when the hon. Member for Bournemouth, East moved the new clause. I am pleased that he thinks that I am a trendy dresser; I shall probably go away for the weekend a happier woman for having received that compliment. I would be very pleased to design a uniform for anyone, really. He thinks that this is not a sexy Bill; all I can say is that he has not seen the rest of them.
My primary point is that the issue in the new clause is not one for the Bill. Opposition Members will understand why we could certainly never accept a new clause stating that both private and Crown employees must at all times wear the uniform—in bed or what? Clearly, a bit more thought must go into the whole thing. I accept completely in principle the need for proper identification of a bailiff to be made plain, at least—and following what my hon. Friend the Member for Islington, South and Finsbury said, possibly at most—to the person who is being visited. We will design an identifier with a unique number on it so that there is no difficulty in knowing exactly who is coming to the door, their status and nature. The identifier will have a number; it will probably have a name too, but the number is important. We will ensure that people know who is coming to their door.
I can see the argument that the public would have increased confidence in enforcement if they saw people in uniform, and I am not unsympathetic to it. They would have increased confidence that the people empowered to do the work were regulated, as they would look more regulated if they were wearing uniform. Opposition Members who have had their ears close to the ground on submissions to the Committee will know that there are concerns about uniform: for instance, that it would make people an easy target. I have had it said to me that when fire officers go on to estates they are sometimes stoned, and bailiffs worry about what might happen to them if they were known to be going into particular areas and their presence were advertised by their uniform.
My hon. Friend the Member for Islington, South and Finsbury made the point that if somebody has to go through the humiliating process of having their goods taken away because of debt, out of respect it ought to be done as discretely as possible. Uniform would militate against that. I am well aware of theneed for proper identification, as is my noble Friend Baroness Ashton, but we are not convinced that a uniform is the right form. We certainly would not state in the Bill that bailiffs should wear a uniform at all times.
There will be times when bailiffs want to have the protection of a stab vest or something of that kind when using their powers of forcible entry, so there may be occasions when it would be in everyone’s interest for us to prescribe that they should dress in a particular way, but there needs to be flexibility. The issue of how to identify bailiffs is very much in the Government’s mind, and we will return to the matter in regulations.I hope that that is sufficient reassurance to allow Opposition Members not to press the new clause.

Simon Hughes: I am grateful to the Minister for her sympathetic response and I am perfectly happy to accept the proposition that the matter be dealt with in regulations rather than in the Bill. I understand the point made by the hon. Member for Islington, South and Finsbury and I wish to add two reflections.
I am dealing at the moment with a case in which there is a dispute between a constituent of mine and a local authority—not our local authority—about the enforcement of liability. It arose, as it happens, from parking fines. One issue in dispute is whether the bailiffs came on the days when they say they came. My constituent says that on certain days he did not see them; he was in, they did not come to the door and nothing was put through the door. The bailiffs say that they came and that they called. It would be easier for that issue to be resolved if the bailiffs had been publicly identifiable, because other people would have seen them and there would be more evidence. People would remember that more clearly, as they would remember a police or fire officer or someone else in uniform coming, than when bailiffs have no uniform and come in civilian clothes, even if they had to present a number, name badge or warrant.
I reflected on the second point when I had a letter this week about another case that I am dealing with. A constituent, with my help and that of my constituency office team, has reached a satisfactory resolution with some bailiffs. Her remaining complaint is that they have added an excessive fee for
“attending with a view to removing goods”—
a charge on top of the original liability order. My constituent is being charged a fee even though she had been trying to contact them to resolve matters and to prevent them coming round to the house. Her letter ends:
“I am enclosing the last letter I received from”
the particular bailiffs’ company
“giving their version of events.”
The gentleman from the bailiffs
“fails to disclose in the letter my many attempts to get in touch with his firm to settle the debt but they refused to listen, insisting that the only option left was to call at my home to remove goods. I am sure you can appreciate that such tactics are commonly used by bailiffs to get more money out of people and that is what they have done in my case.”
 Other important things follow as well—records of communications between people and bailiffs are often crucial. People often say that they have tried to leavea message, have left a message or have sent a letter.I ask the Minister to consider that, in the context of uniforms. I also understand the sensitivity of the example from personal experience of the hon. Member for Islington, South and Finsbury. However, just a name badge or warrant is not sufficient, certainly for older people, people of less intelligence, people who do not have English as their first language or speak poor or no English, or people who are blind or with poor sight. We can all think of such people in every constituency in the land. We need to think of a way that makes the process acceptable to all parts of the community.
I also ask the Minister to reflect on the linked issue of how we can establish a system that traps the communications as efficiently as possible, before people ever come to the doorstep. Ideally, we do not want bailiffs coming to people’s doorsteps; the bailiffs should be able to do their business beforehand, by communication, by letter, by arrangements being made. We need to civilize the process a little.
My last point concerns the last bit of debate on this subject. I think that the local authorities should be able to help with this job more than they do. I am talking generally. Local authority and other debts are eventually passed over to the bailiffs—for example, council tax or other arrears. That is understandable.

Joan Humble: Order. The final point of the hon. Gentleman is not part of our discussion on uniforms. Could he get back to uniforms or conclude his remarks?

Simon Hughes: Absolutely. I want to link my point to local authority people who are now out and about in uniform. I apologise if that was not obvious.
Local authorities, such as mine, often have neighbourhood wardens, who are in uniforms. We have just agreed, as a matter of policy, that all our housing department officials working on estates will have uniforms. That is a way of narrowing the responsibility for the local authority and trying to avoid bailiffs doing the job. The better course of action is to have, as part of the process, yes, the bailiffs when needed—in uniforms—but first, ideally, people who are always out and about on the estate. They are there for a different purpose than the hon. Member for Islington, South and Finsbury suggested. They do not look like special, alien people coming on to the estate.
Could the Minister, her officials and their colleagues in the Department for Communities and Local Government reflect on how bailiffs and their uniforms can tie in with the increasing development of local authority personnel with uniforms? The public wish people in authority—those with powers over them or having an obligation in relation to their property or the goods in it—to be identifiable. I take the point that the first people who come do not come with a particular threat. Possibly some of the earlier work could be done by uniformed people who are employed by the local authority and out and about on the estates. Will the Minister reflect on that and respond to me in writing, having considered how we can combine such work with that done by local authorities and other Departments?

Tobias Ellwood: Although we might not all agree entirely on the wording or, indeed, the principle of the new clause, it has been helpful in raising some of the challenging issues surrounding the mechanics of how bailiffs go about their duties. I thank the Minister for her reply and her concessions in agreeing on some of the issues that we have tried to highlight—in particular, identification.
Clearly, there is a thin line between respecting the concerns of the resident, as we heard from the hon. Member for Islington, South and Finsbury, and improving the status of the bailiff. As the hon. Member for North Southwark and Bermondsey just said, others, such as police community support officers, go about their daily business in uniform. In a coupleof estates in Bournemouth, members of volunteer organisations wear a sort of uniform—a pullover with an insignia and label, which is provided by the borough council to show that they are part of a team working together in a friendly manner. We must bear in mind also that in many cases where there is a concern that a visit might cause problems, bailiffs are often escorted by the police anyway. Carrying out such duties covertly can be a bit tricky. We cannot get away from the fact that they must be overt—that is the way forward.
We were hoping, however, for more of an agreement from the Minister. I wonder if, between now and Report, she will consider a compromise on a wording in order to improve the identification process, which is what we tried to achieve with the new clause. On that note, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 6

Judicial reviews of enforcement agents employed by private companies
‘The actions and decisions of private companies and their agents enforcing the orders of the courts shall be reviewable in the High Court.’.—[Mr. Bellingham.]

Brought up, and read the First time.

Henry Bellingham: I beg to move, That the clause be read a Second time.
We now move from the slightly racy subject of uniforms to a more arcane and lugubrious matter—judicial review. Nevertheless, it is important. The new clause states:
“The actions and decisions of private companies and their agents”—
it remains to be seen whether they will be wearing uniforms—
“enforcing the orders of the courts shall be reviewable in the High Court.”
The reason for the new clause is simple: when enforcement is undertaken by agents employeddirectly by the courts, Crown agents or Her Majesty’s Government, the actions and decisions of the court and agent in question are reviewable by the High Court. Having researched that matter, I am virtually certain that I am correct in saying that. At all times their actions can be subject to judicial review.
On the other hand, when enforcement is undertaken by a private company and its agents, which happens a lot, their actions might well not be reviewable by the High Court. I am particularly concerned about arecent case: Heather and others v. Leonard Cheshire Foundation heard by the Court of Appeal in 2002. As I understand it, that case is still on appeal to the House of Lords. What happened was that elderly people were placed in the care of the Leonard Cheshire Foundation by the local authority. The Court of Appeal found that if they had been placed in a local authority homethey would have had the protection of the courtfrom unreasonable or perverse actions and decisions. However, the Court of Appeal ruled that they could not make use of those rights of protection from the court because they were in an independent, private home.
There is a substantial concern that if that rulingis upheld and applied across the board to private organisations and operations of all kinds, including sub-contractors for local authorities, there will be no possibility of judicial review in the High Court. We are therefore faced with a contradictory situation. We know that judicial review is available when it comes to the actions of court bailiffs—that is, Crown agents. The Minister has said on a number of occasions that she wants a unified and consolidated service, so that everything is brought back under one piece of legislation and everyone knows exactly where they stand, be they consumers or creditors, or commercial organisations trying to enforce their debts or debtors. Basically, there will be one law for everyone.
We know from what we have discussed so far, however, that there are in fact one or two different powers in different parts of the Bill. I would have thought it necessary to ensure that all bailiffs are treated in the same way when their actions are reviewed. For all creditors, whether their debts are being enforced through Crown agents—that is often the case if a Government body of some kind is involved, but not always—or through private bailiffs, and for all debtors, whichever type of bailiff is dealing with the matter, surely there should the same level playing field when it comes to one of the ultimate recourses to justice available to people in this country: judicial review.
We feel strongly about the new clause, which would put those private bailiffs on exactly the same footing as Crown agents—in other words, those agents directly employed by the court or by Her Majesty. On the basis of wanting to make things simpler, easier and fairer, I commend the new clause to the Committee.

Simon Hughes: My hon. Friend the Member for Cardiff, Central and I support the new clause, and hope that the Minister’s response is positive.

Vera Baird: Judicial review is the supervisory jurisdiction of the High Court over an inferior tribunal or a public authority. The hon. Member for North-West Norfolk referred to the case of Heather and others v. Leonard Cheshire Foundation, which is a Human Rights Act 1998 case that concerns the question what constitutes a public authority. When the 1998 Act was passed, it was intended that the definition of a public authority would be a functional one. That is to say—to use the hon. Gentleman’s example—that if a public service is being delivered by a local authority,it is definitely a public authority. If the service is contracted out to a private provider, as long as that body carries out a public function, it, too, should be a public authority and come within the definition of the 1998 Act, even though it is a private body. The issue in the Leonard Cheshire case was whether that body fell within the definition of a public authority. The ruling was that it did not.
I am not sure that that case is going to the House of Lords, but there are other cases on the same point, which is quite a knotty problem from a human rights perspective. When I was on the Joint Committee on Human Rights, I initiated an inquiry into the current state of the law on public authorities, which is a troubled area. One wants to avoid giving rights with one hand under the Human Rights Act, but then taking them away with the other by contracting out services. The issue remains an area of contention, but I do not think that it has direct application in this case.

Henry Bellingham: The Minister does, or does not think so?

Vera Baird: I do not, and let me say why. I hope that I can satisfy the hon. Gentleman as to why not. His argument rests on two assumptions. One is that High Court enforcement officers are Crown employees.They are not; they are business men and women, independent of the Crown, who have been appointed to the post on behalf of the Lord Chancellor by the Senior Master of the Queen’s bench division of the High Court.
I think that the other assumption, which probably follows from that first misapprehension, is that those in question are subject to judicial review. They are not; they are subject to the supervisory role of the Senior Master of the High Court. In that sense, they are reviewed by a lower-level judge in the High Court, but they are not subject to judicial review by the divisional court. The Senior Master has a complaints procedure in his hand, which is right and proper, because he has made the appointments and is responsible and liable for the enforcement of High Court writs. It is correct that complaints should go to him. However, that is not judicial review by the divisional court, which would not, in any case, be the right sort of remedy to seek.
Judicial review is about supervising decisions to see whether they have been made in a situation that is unreasonable—that is, contrary to the Wednesbury reasonableness test—or in which something has been incorrectly taken into account or left out. The officials in question do not make decisions, however; they implement decisions that have already been made by the court. In this case, they would be implementing decisions made by the High Court, and the supervisory jurisdiction of the High Court cannot supervise itself.
The proposed approach rests on two erroneous assumptions, and it would deny us the single area of enforcement law that we want, as it would remove private companies and agents and put them under a different regime—one that would not fit and is not in force at present, and which would be wholly impractical for the reasons that I have stated, as I hope the hon. Member for North-West Norfolk will accept.

Simon Hughes: I am following the Minister’s argument and understand it. First, can she tell us what sanctions the Senior Master of the Queen’s bench division has under either the present or the proposed regime? Secondly, if we want to have one common regime, could somebody who has the necessary authority have brought under his wing the activities of bailiffs who are not court bailiffs? It would be good if somebody who was able to manage people well came into play before anybody felt that they had to start taking criminal or civil action.

Vera Baird: At the moment, the master can removea person’s authorisation to act as a High Court enforcement officer. Presumably he issues warnings and so on in advance of taking that fairly draconian step, so he has a lot of power. The hon. Gentleman will be aware that the Bill contains remedies and that, as we discussed, it is intended to ensure that there is proper regulation by the Security Industry Authority in the case of one kind of bailiff and, as clearly stated by my noble friend Baroness Ashton in the Lords, parallel regulation of those who are not private bailiffs. Hon Members have little to worry about. There is already a civil service complaints procedure in relation to county court bailiffs. The measure would not fill a gap or bring coherence; it would be an odd measure to introduce and is based on two erroneous assumptions seized, I think, by Rev. Paul Nicholson.

Henry Bellingham: I am grateful to the Minister. It was not Rev. Paul Nicholson who came up with the suggestion; it came from a colleague of mine at the Bar. One of the points that my colleague made—I should be grateful if the Minister considered it—was that High Court enforcement officers, who are employed by the Crown, are subject to the Wednesbury rules, but those employed by private companies are not. Can she comment on that?
My other point relates to the supervisory role of the Senior Master. Is the Minister saying that there are no circumstances in which judicial review could be employed against bailiffs? As she said, bailiffs do not take decisions, and the essence of judicial review is to challenge and review decisions, but there have been cases in which bailiffs have had not only to implement decisions made elsewhere, but to use their own intelligence and judgment. I should have thought that that came very close to a decision-making process, and although such things might happen only rarely, I can envisage cases in which there could be a strong argument for judicial review. Perhaps she could comment briefly on those additional points and further put my mind at rest.

Vera Baird: I am happy to do my best. High Court enforcement officers are not subject to Wednesbury rules. To say that they are is a different way of putting the allegation that they are subject to judicialreview, given that the principle of Wednesbury unreasonableness applies to judicial review—it is the same misapprehension repeated in a different way. I would not want to say categorically that judicial review could never apply to a High Court enforcement officer, but it seems an odd notion, given that High Court supervisory jurisdiction is intended to apply to lower tribunals and public officials. Given that a High Court official implements that jurisdiction, the High Court would be reviewing itself, and it does not have a power to do that. At the very least, such a concept—it might not be impossible, although it might well be—would be very awkward and would fit poorly with what I hope is a coherent system that has plenty of protections.

Henry Bellingham: I am very grateful to the Minister and I shall have a word with my learned colleague at the Bar to put him right on this issue; indeed, we may well correspond on it in the future. However, I am grateful to the Minister for clarifying things and, on that basis, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

Clause 86 ordered to stand part of the Bill.

Schedule 15 agreed to.

Clause 87

Attachment of earnings orders: finding the debtor’s current employer

Question proposed, That the clause stand part of the Bill.

Simon Hughes: We now move to part 4, which is about the enforcement of judgments and orders. I have a couple of points about the importance of this part of the Bill and of getting it right. I seek the Minister’s help in setting the issues out, and I think that this is the right clause to do that.
If the Bill goes forward, procedures can be applied to ensure that all the information that is needed in the courts is in the same place. My question is about all court proceedings and comes from my experience in the courts in my previous life and as a constituency MP dealing with such issues. Like all hon. Members, I deal with matters relating to tax, tax credits, benefits, the Child Support Agency and payment orders after a divorce or marital breakdown.
My general objective is that we should give the courts the ability to obtain from all those who are properly authorised and from the appropriate departments the information that they need to make appropriate orders. My concern is greatest historically, and I have two circumstances in mind. First, in criminal matters, people who have come before the court will put to it a statement of their position when it decides what penalty, fine or other punishment to impose. My experience until recently has been that the court often does not have any information other than that given by the defendant or the person representing them.
In a way, the more worrying sorts of case are those in which somebody is trying to escape a civil liability, often to a member of their family or someone to whom they have a personal obligation. It is normally a man trying to reduce his proper liability toward his wife or  partner or, quite often, his responsibility for his child. However, the third sort is a case in which someone is clearly trying to give the run-around to someone to whom they owe money by pretending that they do not have it.
In terms of attachment of earnings orders, the Bill contains a welcome proposal to give the court powers to find a debtor’s current employer—to track them down by their employer, if they are employed. My understanding is that two major Government bodies, a Department and an agency, will now be the normal source of information. The Department for Work and Pensions should have social security records and all the other information. The agency is Her Majesty’s Revenue and Customs, which should have information about people’s incomes and how much tax they are paying. Those are the two major places to look for such information.
I do not yet know, and I have not been able to check in the time available, whether each will have the power to exchange information without authority. I am always careful about not giving Departments power to swap information around. That would have to be authorised. I am quite keen to know whether, for example, if a request were made to the Department for Work and Pensions under the measures to provide information to the court, it would have the right to check things with HMRC or vice versa.
Other people also have information that is relevant if a matter is before the court. The local authority will know, for example, in whose name the council tax for a property is paid and who is registered as the owner of the property. There might be other information. My question is a request at the beginning of this short debate for the Minister’s help. I have read the explanatory notes, the Library notes and the Bill, and I am keen for the court to have the maximum availability of information.
I have two last points, one of which is procedural. A lot of court time is wasted when matters come before the courts, the information is not there and the courts must order that it be provided or sought. Is the Minister satisfied that the Bill will avoid court appearances wherever possible—in other words, that it will ensure that as much work as possible is done on paper without people having to appear? That would save huge amounts of time and effort. In particular, if there is difficulty tracking down someone who is reluctant to appear in court—they may not want to own up to their obligations and not be willing to pay the money that they owe—getting them to court once might be difficult, but getting them there a second or a third time might be just as difficult, if not more so. It seems to me from my experience that the court system, whether civil or criminal, could save a lot of money if we minimise the time for which we expect people to appear in court to deal with such matters.
How can people on whose behalf information is given to the court challenge it if there is a dispute? We all encounter such cases. I am dealing with a tax credit case at the moment involving a serious dispute about liability. It all has to do with what box was ticked on the form and so on. It is a proper dispute, an MP has become involved and it is therefore being taken seriously by HMRC. If the information comes before the court, as it should in the name of maximum information to minimise problems, and it is alleged to  be untrue—that may happen if somebody owns a property but has sold it, or owns a property of which somebody else is the tenant—how will we ensure that the court can obtain that information? I ask out of concern from my own experience. Can the Minister help? This is an opportunity to get those things right, and to have the most effective and streamlined system, while ensuring that it is compatible with people’scivil liberties and rightful protection of personal information.

Vera Baird: We are talking in this clause only about attachment of earnings orders, and the point of it is pretty clear, of course: it applies where somebody’s earnings are attached under an AEO and they change their job, but do not tell the court the new employer’s details. I am not quite sure what the hon. Member for North Southwark and Bermondsey was referring to when he talked about tenancies or people having moved out of their addresses. The provision is about attaching earnings and facilitating the court in tracing somebody who has moved jobs and who does not want to let the court know that they have done so.
My understanding is that the DWP and HMRC share the same database, so it is the same issue. The clause will enable HMRC to provide to the courts, for the purpose of redirecting the AEO, information that it has on file about the employment of the judgment debtor. It enables an AEO to be reactivated if the situation lasts. It is likely that the judgment creditor will be the person who knows that the money has stopped, so they will need to come and tell the court in order to initiate the procedure. That probably requires them to fill in another form or make another application, but it seems hard to get around that requirement, since they will be the person who knows.
Apparently, there will be an ability to seek a hearing with a judge if either party is unhappy with the way in which things proceed. That is what one would normally expect, but it is hard to envisage the sort of mistake that the hon. Member for North Southwark and Bermondsey described. All the provision is about is whether somebody has moved to a job wherever else; if that is confirmed, the court will contact the employer and transfer the AEO. If it is not confirmed, the information could be incorrect; the person may have moved on again, even before HMRC has had time to pin him down. That is really all that this issue is about. 
Of course, there is a very great need—the hon. Gentleman asked how much information we should make readily available in these circumstances—to ensure that the Human Rights Act 1998 is complied with, and to ensure a proportionate balance between the privacy of the individual and the rights of the judgment creditor. Of course, article 8 of the European convention on human rights is a conditional one and in this case is rightly in balance because the rights of the judgment creditor are put high up. However, that is all the information that is required in order to make the power work. I hope that I have satisfied the hon. Gentleman that his fairly wide-ranging concerns are without foundation and that this is a pretty straightforward measure.

Simon Hughes: I was trying to make points about this and the subsequent clauses rather than make such points on each one. I am grateful to the Minister, and I share her view that we have to balance people’s human rights. I have said explicitly that we should not have greater access to information than we need.
Will the Minister deal with one other matter that I raised? Is she satisfied that in this clause and the others in this part of the Bill, we are avoiding people having to come to court other than in the most exceptional circumstances? Has this part of the Bill been proofread to avoid any unnecessary or excessive court appearances, so that we keep down the risk? I am not objecting at all to people filling in the form; I would rather it was done in that way to minimise time and expense.
I have one last small point. Proposed new section 15A to the Attachment of Earnings Act 1971 refers to “the commissioners”. I presume that they are commissioners of Inland Revenue, whom I think we are abolishing elsewhere in the legislation on tribunals. Can I have an assurance that we have done the cross-referencing across the whole Bill, so that if we are ending up with a new structure, we are not left with anomalous terminology?

Vera Baird: Yes, I can reassure the hon. Gentleman about that point, but I do not think that it presents a problem. What is happening is that the Bill is correctly reciting earlier legislation; the commissioners have been included in order to amend it. Any subsequent changes introduced when the Bill is enacted, however, will knock on to those provisions and change the terminology if it is no longer appropriate. I think that that is the right sequence.
Essentially, this is about a form-filling exercise. I imagine that people will be able to get the form online; lots of forms are available online now. I cannot exclude the possibility that someone who is not connected to the internet will have to go to the court or a citizens advice bureau to get one, but a court hearing is not necessary.

Question put and agreed to.

Clause 87 ordered to stand part of the Bill.

Clause 88

Payment by instalments: making and enforcing charging orders

Henry Bellingham: I beg to move amendment No. 136, in clause 88, page 57, line 5, at end insert—
‘(9) Where the judgment that is the subject of a charging order application relates to an agreement regulated by the Consumer Credit Act 1974, the court shall not make a charging order if an order under sections 129 to 135 of that Act is appropriate.’.

Joan Humble: With this it will be convenient to discuss amendment No. 137, in clause 88, page 57, line 32, at end insert—
‘(4F) Where the judgment relates to an agreement regulated by the Consumer Credit Act 1974, the court shall not enforce the charge by an order for sale.’.

Henry Bellingham: I will not detain the Committeevery long on the amendments. The clause deals with charging orders. I have a specific concern about the Consumer Credit Act 1974 and various issues relating to agreements under that Act. The amendments are designed to resolve a possible conflict between the Bill and the 1974 Act. As it stands, the Bill might permit an unsecured creditor to obtain additional security for the debt.
When an unsecured creditor lends money or provides goods they incorporate in the price of the overall arrangement the concept that the debt is unsecured. That is inherent in the contract and the deal that is being done. If a secured debt were created, no doubt the cost of it to the debtor would be cheaper. The Bill gives an unsecured creditor the value of security. Generally speaking, for people who are not very well off, it means a charging order on their home. The clause introduces changes to the Charging Orders Act 1979, which provide creditors with a way of enforcing a court judgment by placing a charge on the debtor’s property.
A creditor who uses that procedure can secure a previously unsecured debt. A creditor who obtains a charging order can obtain a court order to sell off assets, subject to the charge, although obviously such sale orders are pretty rare. The Bill proposes that, even though there is an agreement between the creditor and the debtor for the repayment of the debt by agreed instalments and the debtor is keeping up those instalments, the creditor can obtain a charging order and ultimately bear down against the debtor’s home and arrange to have it sold off.
That concern has been put to me and my hon. Friends by Citizens Advice and other organisations. It relates to the interface between the Bill as it stands and agreements made under the Consumer Credit Act 1974. If we are looking at a package involving a debt agreement, different guidelines and ground rules will obviously apply to that debt if it is unsecured. The creditor should not be able, however, to gain extra security through the backdoor.
These are probing amendments. I should be grateful if the Minister put my mind at rest about whether there is a conflict between existing legislation and the Bill as it stands. What we do not want is to give additional, unforeseen, unintended rights to creditors that could well apply at the expense of debtors.

Simon Hughes: I, too, shall be brief. My hon. Friend the Member for Cardiff, Central mischievously saidto me that I should thank the hon. Member for North-West Norfolk for so effectively deploying, sentence by sentence and word for word, the arguments put by our noble Friend Lord Thomas of Gresford in the other place. I will tell our noble Friend that the hon. Gentleman put the case well.
There was an interesting little debate in the other place on this issue on 14 December, but at the end of it no one, including those who participated, were entirely clear about the outcome. I have read it twice, and I think we are all trying to get a third stab at it.
I stand to be corrected, but as I understand it, if somebody is paying off by instalments an unsecured loan on a car, for example, the issue is whether it should be possible for the creditor to come back and say, “You have kept up your instalments and paid the money, but I want more now. I want to secure the loan and have a charging order, and I will put a charge over your garden shed, garage or house.” Should it be possible for someone who has honoured their obligations and paid up—there is no question of their having defaulted—to be the subject of a stronger remedy?
The Consumers Association was concerned that that would tip the balance wrongly on the side of the creditor and against the debtor. We would argue that a good, paying debtor should not be subject to further impositions on their property if they have kept to the agreement that they entered into.

Vera Baird: I heard the hon. Member for North-West Norfolk compliment the hon. Member for North Southwark and Bermondsey on the way he put his argument, but as the former was reading from the speech made in the Lords by the latter’s party colleague, I have some doubts about what was said. I shall put my argument first and then consider the detail of what has been raised, and I shall be happy to give way if I do not get to the points the hon. Gentlemen are concerned about, although I think I have grasped them.
First, we are concerned that amendments Nos. 136 and 137 could be seen to interfere unduly with judicial impartiality and discretion when considering whether to grant an application for a charging order or anorder for sale—they are, of course, quite separate applications and procedures—in the case of debts that are regulated under the Consumer Credit Act 1974. Clearly, judges will consider applications for the granting of those orders in a proper way, but to require them to favour the debtor is dangerously close to leaving them open to a charge of bias.
The issue has been raised several times before, when the judicial viewpoint was that judges did not wish to have the responsibility to take the risk of looking as if their impartiality might be compromised. Their stance has not changed; in fact, Baroness Butler-Sloss, speaking in the Grand Committee in the other place on 14 December, reinforced the need for any decision about the granting of a charging order to be a judicial one subject to discretion and not in any way trammelled.
When judges consider whether to grant a charging order or, indeed, take the later step by granting an order for sale, they are looking at a judgment debt. The originating source of the debt is by and large immaterial, and it would be inappropriate to place a restriction only on debts regulated by the Consumer Credit Act 1974. The creditor, who has legitimately obtained the judgment, has the right to seek enforcement by the most appropriate means available, including by way of a charging order or an order for sale. Equally, the judge has the right to decide whether he or she shall have one or not.
Broadly, two concerns have been aired. The first is obtaining priority by being able to secure a debt that would otherwise not have priority. In fact, the terminology in the statute is such that the debt does not become a secured debt by the charging order process. It is the judgment that is secured on the property, so there is not an inappropriate impact on priority. I hope that that covers one issue.
The other issue is whether a charging order should be available to somebody when, as the hon. Member for North Southwark and Bermondsey put it, the judgment debtor is complying with their obligations to pay. Let me make it clear that we are not talking about an order for sale on the property; we are talking only about charging the debt on the property. That is intended to avoid the mischief of a person agreeing to pay £4 a week off a £10,000 debt when they have a property somewhere that was perhaps not known about when the original agreement was made. They will now be totally free to simply sell the property off, bring into their own resources an amount of money—for example £100,000—and carry on paying the debt off at a low level. It is far better for the creditor to have what would in every other circumstance lie as a dormant order over the property unless and until there is a need to apply for a sale. Such security should be left in place so that if an occurrence such as the one I have described takes place, people have the security and can get the money back appropriately rather than waiting for the instalments to tick over for years and years. However, I emphasise that there is a big difference between a charging order that simply sits on a property and an order for sale. There is a completely separate, additional procedure for the order for sale.

Brooks Newmark: I hope that the Minister will indulge me in this question. Is she saying that somehow the person who owes the money has deceived by not listing their assets? Usually, when someone has an obligation they must list all their assets and if they do not, they have broken the law in some way. Alternatively, is the Minister saying that if somebody suddenly wins the lottery or inherits a new house, there is a new asset to which a creditor can have an attachment? It would be helpful if that could be clarified.

Vera Baird: It could probably be either. Yes, of course, if somebody did not disclose their assets when required to by the court, they would have broken the law. We are talking about the need for a quick remedy to deal with that problem. Such a remedy is available by charging any property that comes to the creditor’s notice through the court process in the way that Ihave described. On the other situation, if somebody inherited something or, as the hon. Gentleman says, won the lottery and bought something that could be charged, it is realistic that, the circumstances of the debtor having changed, there is an ability to make use of that change.

Brooks Newmark: I understand the first point that the Minister has made. However, on the second point, let us say that, hypothetically, I have a debt to which my assets are attached. Let us say that I then clear my debt obligations in the instalments that were, for example, laid out by the hon. Member for North Southwark and Bermondsey, pay off what I have agreed that I owe and suddenly five years later, I inherit a house or receive another asset. Is the Minister saying that the court has the ability to grandfather a decision that was made earlier and attach the asset so that the full amount that was owed rather than the part that was paid off would have to be paid off five or 10 years later?

Vera Baird: The first requirement is the debt, so if a debt has all been paid off, the ability to charge any property does not exist because there is no debt. Thatis condition number one. If the hon. Gentleman is talking about some form of compromise between parties and unpicking that compromise by means of this—

Brooks Newmark: If I am not explaining myself,I apologise. I am saying that usually in a debt negotiation, I cannot say that—

Joan Humble: Order.

It being twenty-five minutes past Ten o’clock, The Chairman adjourned theCommittee without Question put, pursuant to the Standing Order.

Adjourned till this day at One o’clock.